So far, gains in the U.S. economy have been led by a rebound in manufacturing, as companies slowed their inventory drawdowns and exports rose.

The service sector, which accounts for the vast majority of U.S. jobs, has had a much slower, bumpier improvement as layoffs and tight credit weigh on consumers. Its health is crucial to a sustained recovery from the deep recession that began in December 2007.

The Institute for Supply Management said Wednesday its index measuring service industry activity rose to 53 in February, from 50.5 in January.

Economists polled by Thomson Reuters had expected a smaller increase, to 51.

Any level above 50 signals growth. The 53 reading is the highest since January 2008, when the ISM revised how it measured the service sector.

The service sector is important because it accounts for 80 percent of U.S. jobs excluding farmworkers. That entails jobs in areas like health care, retailing and financial services.